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Yorkville MLP Growth Opportunities Strategy

The investment objective of the Yorkville MLP Growth Opportunities Strategy is to maximize total return by primarily investing in MLPs with high quality and above average cash flow growth rates.

Yorkville’s MLP Growth Opportunities Strategy takes a long-term fundamental approach to investing. The strategy seeks to invest in MLPs with (i) clearly identifiable catalysts for future cash flow growth, (ii) high quality distributions, and (iii) significant price appreciation potential.

Strategy
Brochure

Performance
 
    Annualized  
Name 1 Year 3 Year 5 Year Since
Inception+
Yorkville MLP Growth Opportunities Strategy (Gross) (1) 6.7%-13.2%7.7%11.1%
Yorkville MLP Growth Opportunities Strategy (Net) (2)4.5%-13.9%5.6%8.9%
Alerian MLP (3)0.4%-11.2%1.8%10.4%
S&P 500 (4)17.9%9.6%14.6%7.1%

+ Since Inception: January 1, 2002

Past Performance is not indicative of future returns.

Performance Commentary*

The Yorkville MLP Growth Opportunities Strategy lost 13.9% for the second quarter of 2017. This performance was more than 2 times the negative return of the Alerian MLP Index (“AMZX Index”), which fell 6.4%. Following three consecutive quarters of outperformance, the strategy suffered from underperformance due to concentrated positions which meaningfully underperformed the broader MLP market.

Sector Breakdown*
 

* as of 6/30/2017

Strategy Description
Investment StyleGrowth
Investment PhilosophyStrategic Investment
AnalysisFundamental
Time HorizonLong-term
Holding Period2-5 Years
Alpha DriverFundamentals
Typical InvestmentsMLPs, Energy Companies, and Energy Infrastructure Companies

Stability Score(5)

2nd Quarter 2017

10.0

EBITDA Growth(6)

2nd Quarter 2017

45.4%

Fundamental Attribution*

100% of the holdings in the Yorkville MLP Growth Opportunities Strategy (GOS) either increased or maintained their distributions in the second quarter of 2017 versus the prior year period (2Q16). On average, the holdings produced year-over-year distribution growth of +11.4%. Median forward year-over-year distribution growth is expected to be 45.4%, representing expected strength and improvement in underlying business fundamentals.

Contribution by Sector*

All of the MLP sectors represented in the GOS contributed lost value for 2Q17. Energy Services and Gathering & Processing were the worst sectors for the quarter, contributing losses of 550 and 490 basis points, respectively, to quarterly returns. Crude Oil Pipelines and Refined Product Pipelines lost the least – a combined 60 basis points lost between the two sectors during the second quarter.

 
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Strategy Fundamentals*
Average Yield  5.9% Median Distribution Growth Rate  8.2% Average Market Capitalization  $6,981 Coverage Ratio  1.4x Median Leverage  3.9x

 

Reports

Strategy Brochure

Attribution Analysis

Yorkville Capital Top Ranked
Investment Manager in U.S

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The Yorkville MLP Growth Opportunities Strategy Composite contains fully discretionary equity accounts. The accounts are invested in the Yorkville MLP Growth Opportunities Strategy. The MLP Growth Opportunities Strategy was known as the MLP Core Income Strategy prior to January 1, 2017.

1 Gross-of-fee returns do not reflect the deduction of management fees and certain transaction costs which will reduce performance.

2 Net-of-fee returns are calculated be deducting a management fee of 1.50% from the monthly gross composite return and a performance fee according to the following schedule: 10% performance fee above a 10% hurdle with a high water mark. The management fee was increased from 1.0% and a high water mark added on January 1, 2017.

3 Alerian MLP Index is the leading gauge of energy Master Limited Partnerships (MLPs). The float-adjusted, capitalization-weighted index, whose constituents represent approximately 85% of total float-adjusted market capitalization, is disseminated real-time on a price-return basis (AMZ) and on a total-return basis (AMZX).

4 The S&P 500® Index is a broad-based measurement of changes in stock market conditions based on the average performance of 500 widely held common stocks. Standard Deviation measures the risk or volatility of an investment’s return over a particular time period; the greater the number, the greater the risk.

5 Stability: Calculated as the percentage of holdings which either maintained or increased their distribution versus the same period in the prior year. Based on holdings as of 6/30/2017. Excludes positions which were added to the portfolio following a distribution cut in any of its previous four quarters. Excludes positions with less than 1-year history. The percentage is represented on a scale from 0.0 to 10.0 whereby 0.0 = 0.0% and 10.0 = 100%.

6 EBITDA Growth: Median forecasted year-over-year EBITDA growth for holdings as of 6/30/2017. Excludes positions for which no Bloomberg estimate is available. EBITDA is defined as Earnings Before Interest, Taxes, Depreciation and Amortization.

This information has been provided by Yorkville Capital Management, LLC. All materials presented is compiled from sources believed to be reliable and current, but accuracy cannot be guaranteed. This is not to be construed as an offer to buy or sell any financial instruments and should not be relied upon as the sole factor in an investment-making decision. The views and opinions expressed are those of the portfolio management team at the time of publication and are subject to change. There is no guarantee that these views will come to pass. As with all investments there are associated inherent risks. Please obtain and review all financial material carefully before investing. Past performance is not indicative of future returns. For a GIPS® compliant presentation contact Yorkville Capital Management, LLC at (212) 755-1970 or info@yorkvillecapital.com.